Downsizing Your Ride

Many people are downsizing in different areas in order to save money these days, and purchasing a less expensive, smaller vehicle that gets good gas mileage is probably one of the more common ways consumers are cutting corners, but there may be some challenges to overcome such as paying off the old loan, or trying to resell your old car, particularly if it is a gas guzzler.  Cars such as sports car models and large SUV’s have suffered outrageously in the past couple of years.

Purchasing a used or certified pre-owned economy car that is still under warranty will decrease your costs even more, particularly if your present car’s warranty is up and you have been paying out of pocket for maintenance expenses. 

Everyone knows the sacrifice involved in giving up their big roomy SUV or 4X4 truck, but surely surely, there’s an upside to downsizing your ride.  You may be surprised at how much fun a smaller, gas efficient vehicle can be and how many extra options they can hold. Think about how much simpler it would be to park a small SUV in a busy parking lot.

One of the biggest disadvantages to downsizing your ride is going to be applying for auto credit. One auto loan out of each four is upside down. Meaning that the debtor owes more than the vehicle is worth. A lot of lenders used to allow borrowers to roll over that “negative equity” into the new loan, lending up to 130% of the new vehicle’s price.  Today, you probably won’t find that kind of financing available, so you may have to initially take a loss on your old vehicle in order to downsize and start saving money on a more efficient one.  If you think about it as learning to simplify your life, it may take some of the bite out of the situation.

When you are ready to test drive a new, smaller vehicle, see your local Cross Keys Auto dealer in St. Louis, we have a great line-up of great used and certified pre-owned economy cars.